​The Small Business Blog

In the government world of acronyms, NDAA is one that businesses, especially government contractors, should know and understand. The NDAA or National Defense Authorization Act is a piece of legislation that has passed Congress for the past 52 consecutive years. It is one of the very few bills that has been enacted annually (which says a lot about the importance of this bill). Although the intent of the NDAA is to establish policies and funding levels for the Department of Defense, because it is considered a “must-pass” bill, legislators often include unrelated provisions in the bill in an effort to advance these provisions.

﻿﻿ So, why should businesses care? The NDAA is frequently used as a vehicle to pass business-related legislation. The NDAA for Fiscal Year (FY) 2015 is a prime example. On December 3, 2014, the U.S. House Committee on Small Business put out a press release outlining the specific pieces of legislation that it sponsored and were included in the FY 2015 NDAA agreement, including, among others:

Women-Owned Small Businesses (Section 825) – This provision will allow Women-Owned Small Businesses (WOSBs) and Economically Disadvantaged Women-Owned Small Businesses (EDWOSBs) to receive sole-source contracts. This benefit is already provided to HUBZone and Service-Disabled Veteran-Owned Small Business (SDVOSB) firms, so this provision finally gives parity to WOSBs and EDWOSBs.

Export Assistance for Small Businesses (Section 823) – The intent of this provision is to help small businesses comply with import and export requirements, including the International Traffic in Arms Regulations and Export Administration Regulations.

Comprehensive Subcontracting Plan Reform (Section 821) – This provision seeks to increase transparency and accountability in the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans.

The FY 2015 NDAA agreement passed the House on December 4, 2014, and the Senate on December 12, 2014. It will now go to the President to be signed into law.

Some past examples of business-related provisions included in the NDAA might also demonstrate the importance and implications of the NDAA, particularly for Native contractors. Amendments to the FY 2014 NDAA were offered that would eliminate funding for Indian Incentive Program – a program that encourages subcontracting to Native-owned businesses. While that specific amendment didn’t pass, other harmful provisions have been included in past NDAA measures. For example, in the FY 2010 NDAA, during the House and Senate conference committee (which is used to hash out the differences between the House and Senate passed bills), a provision often referred to as Section 811 was added to the bill. Section 811 requires that any 8(a) Native American sole-source contract over $20 million go through a difficult and time-consuming approval process. This scrutiny is targeted specifically to Native contractors and has resulted in a significant decline in revenue from these contracts. These are just a few examples of the extensive list of business-related provisions included in the NDAA.

In the government world of acronyms, NDAA is one that businesses, especially government contractors, should know and understand. The NDAA or National Defense Authorization Act is a piece of legislation that has passed Congress for more than 50 consecutive years. It is one of the very few bills that has been enacted annually (which says a lot about the importance of this bill). Although the intent of the NDAA is to establish policies and funding levels for the Department of Defense, because it is considered a “must-pass” bill, legislators often include unrelated provisions in the bill in an effort to advance these provisions.